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Obama’s starting point on fiscal cliff talks is his original proposal
WHAT IS THE ‘FISCAL CLIFF': A package of tax increases and spending cuts that takes effect in January unless Congress passes a budget deal by then.
WHO IS AFFECTED: Everyone who pays income tax — and some who don't — will feel it. Middle-income families would have to pay an average of about $2,000 more next year, the nonpartisan Tax Policy Center has calculated.
HIT TO GROWTH: As many as 3.4 million jobs would be lost, the Congressional Budget Office estimates. The unemployment rate would rise to 9.1 percent. The economy would likely fall into recession next year, the CBO claims.
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By The Washington Post
Published: Tuesday, November 13, 2012, 7:46 p.m.
Updated: Tuesday, November 13, 2012
WASHINGTON — President Obama will begin talks with congressional leaders on Friday with a plan to raise $1.6 trillion in new tax revenue from the wealthy — making clear that, at least at the outset, a wide gulf remains between congressional Republicans and the White House on the most contentious point in the negotiations.
While Obama said last week he is not wedded to every detail of his previous proposals, the White House said on Tuesday that it does not intend to provide any new plan or make any concessions before negotiations begin.
Rather, Obama will present his 2013 budget as his starting point — a plan that sought to reduce borrowing over the next 10 years by $4 trillion. That budget proposal was rejected by both houses of Congress. The House vote was 414-0; the Senate vote was 99-0.
“We know what a truly balanced approach to our fiscal challenges looks like,” Press Secretary Jay Carney said. “The president has put forward a very specific plan that will be what he brings to the table when he sits down with congressional leaders.”
Obama meets this week with top lawmakers from both parties to begin negotiations on the fiscal cliff, a series of automatic tax hikes and spending cuts at the end of the year. Obama has said that the election validated his approach to tax policy.
Obama's previous proposal called for raising $1.6 trillion in new taxes on the wealthy by allowing tax rates to increase, imposing a new special tax on millionaires and limiting deductions for the wealthy. He also proposed $340 billion in health-care and entitlement savings, continuing $1.1 trillion in spending cuts already passed into law and generating another $1 trillion in savings through the end of the wars in Iraq and Afghanistan.
The demand for $1.6 trillion in new taxes is far greater than Obama proposed in negotiations with House Speaker John Boehner, R-Ohio, in summer 2011. At the time, Obama wavered between $800 billion and $1.2 trillion in new tax revenue.
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